EPFO subscribers will soon be able to withdraw upto Rs 5 lakh under auto-settlement limit for advance claims (ASAC) without requiring manual verification.
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The Central Board of Trustees (CBT) of the Employees’ Provident Fund Organisation (EPFO) is likely to approve next month the increase of the auto-settlement limit for advance claims (ASAC) ceiling from the present Rs 1 lakh by five times. EPFO members can withdraw PF up to Rs 5 lakh through ASAC soon, officials have told Moneycontrol news website. This revision will enhance the ease of living for crores of EPFO members.
When the auto-settlement limit is raised, the members can automatically withdraw up to Rs 5 lakh instantly. Currently, to withdraw money in advance for amounts above Rs 1 lakh, members have to wait for manual verification. The EPFO presently has about 7.4 crore active subscribers.
The CBT in their next meeting shall grant the approval. “The CBT in their next meeting - likely in May - shall grant the approval, granting significant relief to EPFO subscribers,” an official told Moneycontrol on condition of anonymity.
According to another source who spoke to Moneycontrol, the ASAC limit was raised from Rs 50,000 to Rs 1 lakh in May 2024, which enhanced ease-of-living for EPFO members. According to Moneycontrol, auto-settlement claims more than doubled from about 9 million in FY24 to around 20 million in FY25.
In April 2020, the auto mode of claim settlement was introduced for advance for illness. The EPFO raised the auto settlement of the advanced claim limit from Rs 50,000 to Rs 1 lakh in May 2024.
The CBT may also approve the withdrawal of EPFO claims through ATMs and UPI starting June, during its next meeting, another official told. The National Payments Corporation of India has made the framework for auto-claim settlement through UPI platforms, the person told Moneycontrol.
The EPFO has also introduced auto-mode settlement of advance claims for three more categories: education, marriage, and housing. Earlier, members could only withdraw their PF for illness/hospitalisation purposes.
The funds can now be automatically approved in cases of medical emergencies or urgent situations like home renovation and higher education, the sources told Moneycontrol.
Akhil Chandna, Partner, Grant Thornton Bharat said, “The increasing of ASAC limit is a welcome move, as Provident Fund account holders will receive quick disbursal in cases of emergency or need of funds, and it will also reduce the administrative burden on the EPFO officials.”
With the EPFO's auto-claim solution, claims are handled automatically by an IT system without the need for human involvement. The centralization of member databases under Centralized IT Enabled further streamlines the claim settlement procedure. Human intervention is eliminated as the entire auto-settlement process is driven by an IT system.
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